See also

Writing Off Uncollectable Receivables

A write-off is an elimination of an uncollectable accounts receivable balance recorded on the general ledger. An account receivable balance represents an amount due to Cornell University. If the customer is unable to fulfill the obligation, the outstanding balance must be written off after collection attempts have occurred.

Asset/Liability Reconciliation Guidelines require that accounts receivable object codes be reconciled monthly, assuming there is monthly activity posted. An accounts receivable reconciliation should include a list of outstanding items or invoices and amounts that agree to the general ledger balance.

Generally, receivable transactions should be paid within 30 days. If an unpaid balances exceed 60 days, units should contact the customer to request payment. If the balance is deemed uncollectable, the unit needs to provide at least three documented attempts of collection.

Authorization for Non-Sponsored and Non-Employee Accounts Receivables

Requests for write-off authorization should include:

A brief narrative of the reason for the write-off.

Evidence of multiple collection attempts.

The account number that will fund the write-off.

Email confirmation from the unit's financial manager or FTC/BSC director stating that he or she agrees with the write-off.

Authorization for Sponsored Write-Offs

Write-offs of less than $5,000 may be approved by the senior director of sponsored financial services.

Write-offs of $5,000 or more will require the endorsement of the senior director of sponsored financial services and the approval of the associate vice president and university controller.

Authorization for Employee Write-Offs

Typically these write-offs are travel advances. This does not include a payroll overpayment.

Requests for employee (current and prior employment) write-offs should be sent to the associate vice president and university controller and submitted by the unit’s financial manager or FTC/BSC director. The backup should include a brief narrative of the reasons for the write-off, evidence of multiple collection attempts, and the account number that will fund the write off.

It is important to realize that a write-off may result in additional taxable income to the employee and will require notice to payroll. This process will be determined on a case-by-case basis.

Write-off Entries

Once authorization has been granted for a write-off, the requesting unit will process a Distribution of Income and Expenses (DI) e-doc with the following entries:

The documentation submitted for authorization must be attached to the e-doc.

General Accounting will scan activity posted to object code 6330. E-docs will be auto-reversed if the entry was processed without the appropriate approval or for failure to include appropriate documentation.